European stock markets were engulfed in turmoil on April 7, as investors reacted sharply to a sweeping set of new tariffs imposed by US President Donald Trump. The pan-European Stoxx 600 index plunged more than 6% shortly after markets opened, reaching its lowest level in 16 months and sparking fears of a prolonged global economic downturn. This came just days after Trump unveiled a new tariff regime targeting imports from dozens of countries, igniting a fresh wave of trade tensions not seen since the 2018-2019 US-China trade war.

The broad sell-off extended across the continent, with Germany’s DAX falling nearly 10%, France’s CAC 40 down 6.6%, and Italy’s FTSE MIB sliding 5.7%. The UK’s FTSE 100 also suffered its worst single-day decline since the early days of the COVID-19 pandemic, dropping 6%. Alarmingly, every stock in the FTSE 100 index was in negative territory within an hour of the London market opening-a rare and sobering signal of investor unease.

Sectors most sensitive to trade disruptions were hit particularly hard. Defense firms, banks, and industrial manufacturers bore the brunt of the selling pressure. Shares in German arms manufacturer Rheinmetall crashed nearly 24%, while UK-based Rolls-Royce shed 12%. Mining companies, closely tied to global trade flows and commodity demand, were also deeply affected. Financial institutions saw their valuations slashed as fears of slower global growth and tighter credit conditions mounted.

The scale of the decline underscores the market’s anxiety over the economic fallout from Trump’s latest protectionist measures. On April 2, Trump announced a 10% baseline tariff on all imports to the US, along with additional........

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